Enphase Energy resumed with a Market Perform at Raymond James

Raymond James resumed coverage of Enphase Energy (ENPH) with a Market Perform rating. The company has characteristics of what would generally be considered a high-quality business – it is very well regarded by its customers, commands a dominant market share in its respective vertical despite meaningful price premiums versus competitors, and has to date maintained both market share and record gross margins despite a substantial drawdown in sales post-COVID, but it also operates in an industry where demand is highly dependent on exogenous factors, the analyst tells investors in a research note. The firm further cites “heavily government subsidized demand, utility-controlled net metering credits, variable financing rates on loans/PPAs, and now a restrictive but protective domestic policy agenda” among challenges faced by Enphase.